Saturday, February 18, 2012

Energy Conversion Device




This week a company founded in 1960 that is in the business of energy conversion went into chapter 11 of bankruptcy. The company is called Energy Conversion Devices and they are in the business of making thin film laminates for solar power devices as well as cathode materials for lithium ion and nickel metal hydride batteries. Another US company that is a casualty of cheap Chinese competition. This company still trades for a quarter a share under the symbol of ENER on the NASDAQ. A few weeks back another US lithium ion battery company caller Ener1 went under. I guess it is just bad luck to use the symbols ENER for your stock. Actually it is simply a sad fact that these battery businesses are unprofitable and no matter how much money the policy makers in DC hand out, the basics of the business remain dismal.

Of course Tesla manages to keep their stock way up with promises of future sales of vehicles yet to be launched. They reported a loss this quarter of over $81 million, but have taken advance orders for their $80,000 crossover SUV. Our government gives money to the rich to hog the lithium that should be shared. Tesla is the shining star in this wonderful transfer of wealth from the poor to the rich via the US treasury. President Obama appeared in the San Francisco Bay Area to talk about manufacturing jobs. Yet most of the action was for fund raising for the upcoming presidential elections. Yeah jobs for the masses and political advertising money for the mass media. A wonderful expression of democracy where there is a chicken in every pot and Tesla in every garage.

Amyris the “advanced” biofuel “producer” also had a case of mighty hiccups this week. It certainly looks like their technology simply does not scale and cannot compete with fossil fuels. Their stock is now $6 a share and pretty close to the price of a gallon of diesel. The President had pinned his hopes on “advanced biofuels” and Vinod Cost Us with his VC buddies at Kleiner Perkins had the President believing in this junk science up to a few weeks ago. By November there won’t be even a mention of the “advanced” biofuels, lithium batteries, solar cells, or the myriad failures in the alternative energy space. The President will say “thanks” to Dick Chaney for allowing fracking of shale to have happened so he can win reelection on the wings of his clear policy that allowed shale gas and oil to help America wean itself off of imported oil. Yeah politics makes some very strange bed fellows. Obama is lucky that Cheney loved fracking of shale and that this single technology that Obama and Chu so despised two years ago yielded results while all the hyped high tech baloney just sucked the wells of money in our Capital dry.

Actually the good news over the past months is that Chu Chu has basically disappeared from sight and his department of entropy is not spending money like a run away train. Stevie Not So Wonder will be the fall guy in the fall and I doubt we will have four more years of the “real” Nobel Prize Winner. He heads the Energy Department and like an energy conversion device he too is headed toward Chapter 11 and thank goodness a closing chapter on a brilliant scientist who sold hope for his boss instead standing up to him and giving him sage advice.

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